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Obama School Reform Plan Relies on Big Business


With Republicans gunning for the Education Dept., the President needs companies to help him fend off deep budget cuts

To help the U.S. compete with emerging economies such as China and India, President Barack Obama pitched Congress on a renewed focus on education in his Jan. 25 State of the Union message. "This is our generation's Sputnik moment," he said, invoking the U.S. response to the Soviet Union's 1957 launch of the first satellite. That feat, at the height of the Cold War, jarred American assumptions of technological superiority.

With a divided Congress and House Republicans gunning for the Education Dept., Obama's school reform plans may depend largely on Big Business. Administration officials say they have had more than 30 meetings and phone calls over the last year with executives about school overhaul. Penny Pritzker, who led Obama's 2008 campaign fundraising effort and is chairman of Pritzker Realty Group in Chicago, says she's "sure that business leaders will be asked to go to Capitol Hill to make the argument" for an improved public education system. Jeffrey R. Immelt, the General Electric (GE) chief executive officer, agrees education should be a part of his portfolio as head of Obama's new jobs and competitiveness council, Pritzker says.

Obama is proposing to make permanent a tuition tax credit program and to revitalize community colleges. The bigger challenge will be revamping President George W. Bush's No Child Left Behind law, which expires this year. It requires schools to test students and show yearly progress toward goals or risk losing federal money. Obama wants to give schools more flexibility in demonstrating academic progress, reserving the harshest sanctions, including firing teachers, for schools in the bottom 5 percent in achievement. He also wants to give school districts the power to apply directly to Education Secretary Arne Duncan's Race to the Top program, which enables states with innovative programs to compete for federal funds.

Republicans have other ideas. John Kline (R-Minn.), the new chairman of the House Education & the Workforce Committee, said in a statement that his goal is to "pull back federal involvement in the day-to-day operation of our classrooms." More than half of the 22 Republicans on Kline's committee are members of the Tea Party Caucus or were endorsed by conservative groups such as FreedomWorks and the Tea Party Express. Committee member Tim Walberg (R-Mich.) has said he sees "no place for the federal government in education." The total Education Dept. budget is just under $47 billion, not counting about $17 billion in Pell grants.

Duncan says he intends to "provide a lot more flexibility" by letting teachers and principals "figure out how to hit that higher bar, hold them accountable for results but give them the room to move." He says he's optimistic, adding that he's spoken to House Speaker John Boehner "numerous times" and to "almost every single new member."

From the opposite side, the National Education Assn. and the American Federation of Teachers (AFT), which together represent about 4.6 million educators, are unhappy with Obama's support for charter schools and merit pay for teachers. "There's no track record for simply saying that if you have a couple of charter schools, the other schools will get better because of the competition," says Randi Weingarten, president of the AFT. "There's no track record for paying a couple of teachers more and then thinking it's going to turn everything around."

Failure to refashion the No Child law would put more schools at risk of being labeled failures, says George Miller (D-Calif.), the House Democratic leader on education issues. "More and more schools are going to bump up against the requirements" that they're not going to be able to meet, he says. About one-third of U.S. schools are considered failures under the law's guidelines, according to Jack Jennings, president of the Center on Education Policy, a Washington-based group that advocates for public education.

Amid the turmoil and clashing agendas, corporate executives' perceived pull with Republicans could be the White House's trump card on education. "Wherever I can have the biggest impact, be it at a hearing or whatever in Washington, I'll make every effort to be there," says State Farm Insurance Chairman and CEO Edward B. Rust. Obamas very public attempts to make amends with business may help assure that Rust and his counterparts follow through on that pledge.

The bottom line: Obama wants business to help him hold the center and fight off Tea Party and union efforts to block education reform.

Brower is a reporter for Bloomberg News.

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